Open Enrollment = Confusion

Open enrollment.  My HR website says "All new exciting benefits for 2010/2011"  What this really means is "you are about to enter  into a strange murky world of non-intelligible double speak which you have to untangle in order to make the right choice."

The good news is, thanks to the health care bill, I no longer have to worry about Shawn's full-time status at school.  (The kicker is, for the moment he's actually scheduled to be a full-time student for the first time since Freshman year.)  But regardless of his current enrollment, we won't have to start worrying if he ends up dropping a class, so YES, I am still quite thankful for the bill.

The new choices seem straightforward, there is a nice little table with the 8 different policies and key features to compare.  It turns out this table is at best useless.  At worst, perhaps a little misleading.

There is an HDHP (High Deductible Health Plan) choice, which allows you to also establish an HSA (Health Savings Account).  Last year my accountant suggested I look into this type of account, as I spent a considerable amount on medical expenses, but not quite enough to itemize.  The nice thing about an HSA account is you can roll over any money left in it from year to year, and it earns interest tax free.  Money from the account can be used only for medical expenses.  And you can only open one with a corresponding HDHP.  

So on to the HDHP.  The deductibles on this are  $2500 individual/$5000 family.  You might think that means that as soon as a single person (individual) on the plan pays more than $2500 that they have met the deductible.  I would think that as well.  And it seems we would be wrong. 

After spending quite a long time talking with a really nice woman from Aetna - one I have every reason to believe knows what she is talking about - I have learned that the HDHP policy has a different definition of family vs. individual deductible than the PPO policies. 
 
The HDHP policy requires the family deductible to be met if the policy  is a  "family" policy - that is if it covers more than a single person.  The PPO deductible is a per/person amount even for a policy that covers more than a single person.  So under the PPO, Shawn's deductible will be met when he has more than the individual amount of expenses, while under the HDHP it won't be met until the family limit has been met.   This sounds awfully strange to me and possibly I've still got it wrong, but we spent quite a long time talking about this and the representative was pretty specific about it.

Another thing: How you satisify the deductible is different for different plans.  For the PPO, pharmacy costs do not count towards the deductible.  But for the HDHP,  cost of medicine does count towards the deductible.

The nice little table that my HR website has  comparing the plans is pretty much meaningless, since the same language means different things for different policies!   How you meet a deductible is different, which deductible you have to meet is different, what happens once you meet the deductible is different. 

Under the HDHP, you pay full costs for everything until you meet the deductible.  Shawn's monthly pharmacy bill alone will be enough to do this within approximately 8 month, even with no other medical expenses.  So I know we'll meet the deductible, but then I also know we'll blow through all the money in the HSA.  

I started today's call thinking I wanted the HDHP.  Now I'm less sure.   While the HDHP policy is quit a bit cheaper, the HDHP + HSA together are about the same price as one of the PPOs.  And I know I'll use all the money in the HSA, so there will be no chance to roll it over (one of the things that is attractive about an HSA).  Which makes it not that different from the higher premium of the PPO, which is also paid in pre-tax dollars. 

After spending a few hours on this today, I now think I need to delve into the other differences between the HDHP and PPO coverage of individual expenses.  I think I'll be back on the phone again tomorrow with Aetna's customer service. 

And in the meantime if anyone out there has any insights or experience with an HDHP plan (especially Aetna's HDHP) please leave a comment below!